SpartanNash to pilot e-commerce service, unveil ‘click-and-collect’ at 25 stores by year end

BYRON CENTER — Grocery retailer and distributor SpartanNash Co. plans to unveil a new e-commerce service that will allow customers to order products online and pick them up at a store.

SpartanNash will pilot the program with store associates at an as-yet-undisclosed Family Fare location in the greater Grand Rapids area in the first quarter of this year, according to Meredith Gremel, vice president of corporate affairs and communications at the company.

If the project delivers the expected results, SpartanNash anticipates that 25 stores will offer the service by the end of the year. The roll-out could begin as early as the second quarter.

Gremel told MiBiz the launch will start with the firm’s Family Fare banners and eventually spread to other stores, including D&W Fresh Market and Forest Hills Foods.

Executives at SpartanNash (Nasdaq: SPTN) first discussed the so-called “click-and-collect” program in a conference call last week to discuss the company’s fourth-quarter and full-year 2016 earnings.

“I think as we roll out this click-and-collect, it takes our whole … e-commerce and personalization efforts to a next level,” President and COO David Staples told brokerage analysts in the call. He said the service could be powerful for targeting promotions and better understanding customers.

SpartanNash is working with Toronto-based Unata Inc., a provider of e-commerce solutions for retailers, to develop the platform.

Unata already works with a handful of U.S.-based retailers, including Lowes Foods, Lunds and Byerlys, Raley’s and Roche Bros., plus Longo’s in Canada, according to a report in Supermarket News.

Click-and-collect services have been rising in popularity in recent years as more consumers demand convenience in their shopping experiences, choosing to shop online and visit the store only to pick up their orders.

In West Michigan, Walker-based Meijer Inc. debuted its Curbside service in 2015 at select stores before rolling out the click-and-collect system to nearly three-dozen stores currently, according to reports.

At SpartanNash, Chairman and CEO Dennis Eidson said the company also could look to offer the click-and-collect product to its distribution customers.

“This system is … pretty technically advanced,” Eidson said in the call. “It actually is going to take our website to new levels, it’s going to bring apps into the process. … (It’s) going to be very, very all encompassing.”

Eidson said the company also experimented with different click-and-collect services at nine stores, but opted for “a much more comprehensive solution” that Unata offered.

SpartanNash for the fourth quarter generated sales of $1.83 billion, an increase of 3.4 percent from the prior year. Reported net earnings dipped 25 percent to $12.8 million, or 34 cents per diluted shares. Adjusted for charges related to underperforming stores, integration costs and acquisition activities mainly from the deal to buy Caito Foods Service Inc. and Blue Ribbon Transport Inc., earnings were $20 million, or 53 cents per diluted share, compared to $19.6 million, or 52 cents per diluted share, in the same quarter a year ago.

For the year, sales for SpartanNash increased $82.6 million, or 1 percent, to $7.73 billion. Full-year adjusted earnings from continuing operations were $82.2 million, or $2.19 per diluted share, which compares to $74.6 million, or $1.98 per diluted share, in the prior year. The adjusted earnings reflect growth in food distribution and lower operating expenses and exclude $25.1 million of charges primarily related to restructuring costs, underperforming stores, and acquisition-related costs.

The company expects to generate higher sales in its food distribution business for the 2017 fiscal year, while sales in its military and retail segments are expected to be “challenged” or “slightly negative to flat,” according to a statement.

Eidson said the company expects adjusted earnings per share from continuing operations of $2.26 to $2.35, excluding merger integration costs and other adjusted expenses and gains, up from $2.19 last year.

Caito and Blue Ribbon Transport are expected to generate combined sales of $550 million and be accretive for the 2017 fiscal year, according to a statement. SpartanNash acquired the companies in a $217.5 million in cash deal that closed on Jan.

SpartanNash also expects to spend $70 million to $72 million on capital expenditures for the fiscal year.

--Editor’s note: The original version of this story included a couple of instances in which SpartanNash Chairman and CEO Dennis Eidson’s last name was misspelled.